Blue Shield of California bypasses PBMs to slash Humira prices by 90%

In a bold move to tackle soaring drug costs, Blue Shield of California is pioneering a strategy that bypasses traditional pharmacy benefit managers (PBMs) to bring blockbuster drugs to patients at a fraction of the cost. By partnering directly with manufacturers, the insurer aims to dramatically reduce the price of AbbVie's Humira, the world's top-selling drug, by up to 90%.

Blue Shield's agreement with drug manufacturer Fresenius Kabi, an operating company of Fresenius, and Evio Pharmacy Solutions, which facilitated the deal, introduces a new model called Pharmacy Care Reimagined. This approach aims to eliminate the excessive markups often found in traditional PBM models, providing members with better access to biosimilar medications.

The company isn't alone in adopting new strategies to address rising drug costs. The Mark Cuban Cost Plus Drug Company, part of the celebrity businessman's broader effort to reveal drug price inflation, also sells a version of Humira for $584 for cash-paying customers.

Paul Markovich, CEO of Blue Shield of California, emphasised the company's commitment to change: "We will no longer take part in a pharmacy system that is designed to maximise the profit of participants instead of the quality, convenience, and cost-effectiveness for consumers. Every employer, health plan and payer should be asking – and challenging – their pharmacy benefit managers to offer clinically effective and lower cost alternatives at a transparent price."

Humira's patent expired in January 2023, opening the door for lower-cost biosimilars. However, prices haven't decreased as much as expected in a functioning market, limiting widespread adoption. As such, Blue Shield claims that its plan to introduce biosimilars could lead to savings of up to $1 billion per year for its members.

Starting January 1, 2025, most Blue Shield commercial members using Fresenius Kabi's adalimumab-aacf (a Humira biosimilar) will pay $0 out of pocket. This collaboration is expected to reduce drug spend while potentially increasing medication adherence, benefiting overall care costs and member health outcomes.